Virginia to Study Accepting Gold, Silver Coin as Tender

Friday, 08 Feb 2013 08:17 AM

By John Morgan

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The state of Virginia is moving toward issuing its own coin currency, but the move appears to be mostly a conservative note of caution — for now.

A proposal that could lead to creation of a Virginia coin passed easily this week in the state’s House of Delegates by a lopsided two-to-one majority.

According to The Washington Post, the idea that Virginia should issue its own money was “dismissed as just another quixotic quest” when it was proposed in the legislature three years ago by state Del. Robert G. Marshall, a conservative Republican.

Editor's Note:
This ‘Third War’ Will Be the Most Destructive in History, Warns Pentagon Adviser

But now the notion of states’ currencies is also being entertained in other states as well, The Post reported. Utah has already approved a law recognizing nontraditional currency, and four other states have similar bills pending.

“This is a serious study about a serious topic,” Marshall said. “We’re not completely powerless.”

Marshall’s legislation would create a 10-member commission to study “the need, means and schedule for establishing a metallic-based monetary unit to serve as a contingency currency for the Commonwealth.”

States do not have the constitutional authority to print money, but Marshall asserts a potential federal loophole could allow states to coin silver and gold. The measure must still pass the Virginia Senate, where its future is apparently uncertain.

Much of the motivation behind states’ currency ideas arises from suspicion or lack of trust in the Federal Reserve, according to The Post.

Since the financial crisis, the Fed has pumped trillions of dollars into the banking system to try to jumpstart the economy. Marshall believes the end result could be a depleted dollar, rampant inflation and a collapsing government, The Post reported.

Lawrence White, a George Mason University economics professor, supports Marshall’s proposal.

“I think the most effective way to send a message is to say you’re prepared to do something,” he said. “I view it as a kind of state-level expression of concern about the uncharted course the Federal Reserve has been on in monetary policy.”

In an editorial, The New York Sun noted some of the nation’s founders — George Washington, Thomas Jefferson and James Madison (all Virginians, by the way) —believed “gold and silver are the true money.”

“Washington warned that paper money always has the effect ‘to ruin commerce, oppress the honest and open the door to every species of fraud and injustice,’” the Sun opined.

“Jefferson called specie — meaning gold and silver ‘the most perfect medium because it will preserve its own level; because, having intrinsic and universal value, it can never die in our hands, and it is the surest resource of reliance in time of war,’” the editorial said.

Editor's Note: This ‘Third War’ Will Be the Most Destructive in History, Warns Pentagon Adviser

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